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Chinese Networking Vendor Huawei's Murky Ownership
A month ago we mentioned India's suspicions that telecomm equipment from China might contain backdoors. There hasn't been any smoking gun on such speculation. Now reader littlekorea sends in some background on the ties one important Chinese telecomm vender might or might not have to the government there. "Conspiracy theories abound as to whether networking kit vendor Huawei is owned or controlled by the Chinese government and/or the military-industrial complex. But who really owns Huawei? Kiwi journalist Juha Saarinen headed to Shanghai to find out."
Just compare the code byte for byte with Cisco's. Any differences are the Chinese backdoor.
From tfa, the hardest part for this "western observer" to understand is what happened to the other 0.02% shares...
I'm not buying any more Chinese equipment. From now on I'm only buying from reputable American companies.
i kinda like how they have their business model. give employees "virtual shares" without any real power outside of the company to keep them happy as well as keep them, appoint your ritzy executives in a council but give the illusion anyone can be voted in, and lots of performance gauging of the workers. sounds more effective than the u.s. company i work for, honestly.
WÌÌfÍ--ÍSÌÒÍ...Í...ÌHÌÍfÍÍÍ--ÍÍÍ
"Conspiracy theories abound as to whether networking kit vendor Huawei is owned or controlled by the Chinese government and/or the military-industrial complex."
Only OTHER countries have medical-military-industrial complex. The United States has ( excuse the Rand Paul reflex) C-C-C-a-a-p-p-i-i-t-t-a-a-l-l-i-i-s-s-m-m.
I presume Cisco and Microcrap Windows have no backdoors.
Yours In Norlisk,
Kilgore T.
What if they have (VERY SLIGHTLY!) different hardware?
Even "binned" chips end up somewhere.
Only the manufacturer knows how to test every path correctly for proper function.
To reverse-engineer audit anything is EXTREMELY expensive and time consuming, done right.
Why bother? Don't buy crap from China and do their QA for them. Buy American.
Comment removed based on user account deletion
This strikes me as a straw man argument in many ways. Why would we assume that the ownership of the company has anything to do with the possible influence or even direct manipulation of the products produced by the state in which the company is headquartered and operated? That is a very western view. Even if we take that point for granted, the public shareholders of even a US company have quite limited visibility into its day to day operations beyond quarterly financial and very broad and deliberately limited strategic objectives of management.
Does anyone have a list of brands manufactured by said companies? I`d like to keep an eye on them.
"Conspiracy theories abound as to whether networking kit vendor Huawei is owned or controlled by the Chinese government
There's no need for a conspiracy theory. All industries in China's economy are controlled by the government. The only question is the degree to which this control is exerted.
and/or the military-industrial complex.
You can only have a military-industrial complex in a country where the two aren't both arms of the government. An iron triangle can't exist when only one actor is involved.
So, after reading the fine article, it seems to me that the company is, officially at least, a coop. Only employees are allowed to own shares, which are primarily used as a method of profit sharing and performance rewards. It's actually not a bad model if you don't need the capital you can get by selling stock. There's a handful of companies in the US that do things much the same one, Ocean-spray being the first example that comes to mind.
I don't see anything in the article about if/when/how the Chinese government influences the company beyond an offhand remark about the CEO's past work at the beginning and an otherwise unsupported statement at the end. How exactly would the company being publicly traded ally fears that the Chinese government is exerting control? It isn't as if the stockholders would have to know about the situation, nor would the fallout be any more severe if they were found out (either way the company would be going bankrupt very rapidly).
There is a structure that makes it appear that the workers own the company. Having worked for a US company controlled by Asian interests, I found the structure rather familiar. It is done to reward workers based on results, and retain good employees.
Other than that, there is no overwhelming evidence of government ties. Just a company with a management structure meant to maximize the appearance of employee control. The fact that the façade may not match reality does not mean the reality is a conspiracy.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
All companies have some murky shares.
The largest prime factor of my UID is 263267.
What is the difference between a back door, and a section of code which is deliberately a little bit sloppy to allow for a vulnerability that would just be very difficult for someone to discover? You are assuming that any back-door which does exist would be well labeled as such and therefore serve the function of a smoking gun if discovered. In reality it would probably be far easier to just not fix certain bugs deliberately and provide detailed documentation of them to the right people.
You are supporting communism! Thats right, the CEO of Huawei is a fully paid up member of the Chinese Communist Party.
In 2001 you had to go through the trouble of Pirating MP3's to support communism but these days you only have to buy the modem.
you get what you pay for!
There's precious little information in TFA on company ownership. Looks like speculation and witchunting.
That doesn't mean it's not absolutely correct, but it surely didn't evince its claims.
That said, anything the Chinese Govt. has a hand in, I've got a foot swinging towards.
When Americans have backdoors, it's to protect American interests and therefore "good". When the Chinese have backdoors, it's to protect Chinese interests and therefore "bad".
You can apply this same logic to foreign policy. Both value systems are based on power instead of principle.
When T-Mobile released the "T-Mobile Tap" -- manufactured by Huawei -- I bought it the first week. It was cheap, had a huge screen, and counted as a "dumbphone" so it wasn't subject to the smartphone data plan upcharge.
I've regretted that purchase every single day since.
I posted a litany of woes over on the HoFo forum. I have never had a phone that provided me with such daily reminders of why I don't buy new products.
The interface is clunky and inconsistent -- it's clear that one dev team built the dialer, another dev team built the text message system, and another one built the contacts. All of those reference things like typing and phone number entry, but they all do it in different ways! And, they all suck. In fact, none of the functions play well together. All of the built-in apps can be dragged onto the "desktop", but most of them go away every time you power-cycle.
And the hardware is cheap. Every time a sound plays (like a ringtone) on the external speaker, there's an audible "pop" as the speaker gets power and another "pop" when the sound completes and the speaker powers down. And the processor often bogs down during complex tasks, such as entering a phone number. :P Of course, it's a sub-$200 touchscreen, so I didn't expect top-notch hardware -- if that's all that sucked, I'd be happy.
The worst part is just cropping up now, though. Random software issues are killing the digitizer. I'm quite certain it's not hardware, because it typically happens after running a Java app (such as the built-in Google Maps, or the Opera Mini I downloaded but can barely use because the phone only gives it a data connection half the time). Also, strange behavior occurs when the digitizer is wonky, like when the text message notification bar goes away or the options at the bottom of the screen disappear and leave the background visible.
Maybe it's not just bad software... maybe these are indications that the Chinese government is monitoring my calls and text messages. Maybe I got on their bad side by using Google Voice? If that's the case, they're getting a whole lot of messages like "I'll have to call you back, my phone is crapping out again".
I learned one lesson, at least. If the manufacturer isn't willing to put their name on it, don't buy it! T-Mobile should follow that advice, instead of tarnishing their name by associating it with this piece of crap Tap.
Stressed? Me? Of course not. Stress is what a rubber band feels before it breaks, silly.
"We can make the enemy's command centers not work by changing their data system. We can cause the enemy's headquarters to make incorrect judgments by sending disinformation. We can dominate the enemy's banking system and even its entire social order." General Pan, Chinese PLA
Now, that was in 1996. I think he read the tea leaves correctly even back then, and the world has become a lot more interconnected in the last 14 years. Read More
Of course the US would never put back doors into security critical products.
AG
owned or controlled by the Chinese government
Isn't everything in China owned or controlled by the government?
Murky ownership? What did you expect from a company called 'who-are-we?' :P
China is so dependent right now on American and global consumerism. Their economy is dependent upon exports and keeping their people gainfully employed. Imagine what would happen if real unemplyoment happened in China. We are tied to them like they are tied to us.
Care to elaborate?
The largest prime factor of my UID is 263267.
I'm posting this anonymously for obvious reasons. China isn't the only government who may have an interest in providing a back-door. Back doors have been found in Cisco gear in the past, and it would be naive to assume that they aren't still there. Consider two possibilities: 1) Cisco and Microsoft are incompetent and unable to secure their products. 2) An outside influence has approached both of them and created a covert program to ensure access to the IT infrastructure of our enemy.
From the original story:
"the fast-growing telco supplier's ownership structure is still fascinating, strange and tricky for Western observers to understand." ...whereas, of course, the ownership structures of 'Western' companies are *always* beautifully transparent! sheesh.
I have been using Huawei's sonet gear for the last 5 years. I work for a CLEC. I have about 50 nodes in the field.
They are a mix of M800s, M1600s, and M3600s that are spread out over multiple states. They are a real pleasure
to use and have been rock solid. Their price point compared to other vendors was a no brainer and have allowed
us to improve our network.
Take the M1600 which is a 3-4U box. It has 8 slots that can take a wide array of cards from OC48, 12 DS3s, 28 T1s,
ethernet GigE ports, ethernet 10/100 ports, multi port OC12/3, and even up to OC192 which I have not used yet. When
I did have a card laser failure they RMA'd it and gave me a new card even though it was no longer under warranty. Their
support is quite good and I speak with Americans who are located in Texas.
All the gear is on a private network so I am not quite sure how a backdoor would ever allow them access or the ability
to enter my gear if they so desired.
So with that said, if Huawei combined with the Chinese govt can deliver such an enjoyable experience for my company
and I when it comes to using their sonet gear, I am all for it.
a section of code which is deliberately a little bit sloppy to allow for a vulnerability that would just be very difficult for someone to discover?
AKA: a back door.
Security is mostly a superstition... Avoiding danger is no safer in the long run than outright exposure. - Helen Keller
In this day and age, you have to assume anything not open-sourced contain backdoors.
This article notes nothing abnormal about Huawei's corporate structure, for a Chinese corporation or any corporation. The author describes an employee stock ownership plan, ESOPs exist in plenty of western nations and there is nothing sinister about them.
The author trying to use this round about "the company setup weird, that makes it bad" argument belies the fact that corporate structure is irrelevant to the quality of the products produced.
This article makes me think the author has the following motivation to write the article:
1. Paid by a competitor to smear Huawei
2. Paid by an investment bank that wants to take Huawei public, to convince Huawei management going public will improve Huawei's public image, thus making the investment bank a mint on the IPO and another small fortune when the investment bank sells the shares of Huawei to the investment bank's customers.
Well exactly. It's a back door but it wouldn't be all that special to "discover" it. There is no risk in leaving those types of holes in the system and they work just as well as the ones which you create deliberately.
All hail Kdawson, king of the bad summary. Usually they are just plain wrong, but this one is wrong, over-simplified and has poor grammar to boot.
The trifecta of bad, KD! Don't quit your day job (unless this is your day job, then feel free to quit).
I tried to think of a good sig, and this wasn't it.
Even further, if they are reverse engineering cisco products to create their own, it's entirely possible that they have accumulated a number of valuable zero day exploits that can be used against the firmware which they have extensively studied as part of their duplication efforts.
Buy the right hardware and run M0n0wall or pfsense. If you can audit the code of your firewall it's the only way to be sure there are no backdoors in it.
I have had a M0n0Wall running for well over 6 years with no problems. Granted it's for a very small company with only a few thousand users.... but there are some out there doing the work for fortune 500 companies.
Do not look at laser with remaining good eye.
Is the company in China? Then the Chinese government owns it. Let's not kid ourselves.
3. Paid by the CIA 4. Paid by the same guys who created the Toyota SUA stories
So the Chinese are still pissed about the NSA Key that Bill hid in Windoze and are hacking you to get even ?. Pretty much everything likely has at least one back door these days. Use open source everywhere
Doesn't sound a lot like a kiwi name...
Like "China Shipping", its still owned by the Chinese army. They have been pretending that they don't anything for two decades but all the top people in the army moved into running large companies like Foxconn over a decade.
Do you really need to "find out"? Everybody in China knows that it's owned by the son of the previous president, Jiang Zemin.
Whats murky about the ownership of Huawei? They seem to answer the question when asked. Here's a headline: "Xenophobe media is xenophobic".
A fun read to go through: http://en.wikipedia.org/wiki/List_of_Chinese_inventions
Yes, they were a bit sidelined for few last centuries; considering the above list it's not totally unreasonable to look at any possible present "tech stealing" as collecting debt, in the process of revving up again.
One that hath name thou can not otter
What are we doing to protect our Rhodium supply?
JADBP
If you fear spooks, think about this: any chips manufactured in China are potentially suspect for backdoors.
You, my friend, should take part in the "Underhanded C" contest.
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
I work in the telecom industry and can say that Huawei cellular network products also suck, both hardware and software.
Yes, they are cheap, but there's a lot of work to put them together (same company!) and keep them working.
Judging from the article author's name, he's obviously of Finnish origin. Now, Linux was created in Finland. Therefore, the Finnish government is the real controller behind Linux and this article is an attempt by the government of Finland to discredit a competitor in the world market for information technology.
See, pulling out conspiracy theories from one's ass is not so difficult...
When Americans have backdoors, it's to protect American interests and therefore "good". When the Chinese have backdoors, it's to protect Chinese interests and therefore "bad".
You can apply this same logic to foreign policy. Both value systems are based on power instead of principle.
This, in a nutshell, is the reason why people in most countries dislike US - not americans - but the US. The US foreign policy is so selfish, that it is almost laughable. Give $5B to Africa, then expect them to buy stuff only from American contractors - even though local solutions would be 10-20 times cheaper. At the same time subsidize cotton farmers in the US - and they flood the market screwing Africa's cotton farmers. And this repeats.
1. Iraq - go for oil, say you are going for WMD, plan only to save oil resources, so everything else gets mucked up. And then wonder why everyone doesnt love you.
2. Terrorism - except for US and UK incidents - everything else is not terrorism. So people die in India - and US continues to support Pak and it's support of terrorism - no wonder we feel that 9/11 was a good eye opener!
3. Pollute the world - and then go nuts when pollution happens in the backyard. So again, I for one, am happy that new laws in the US will help the world be safter.
And then Americans expect to be loved.
Best of luck kids! Hopefully your foreign policy will become a bit less selfish soon!
Any differences are the Chinese backdoor.
Why would the Chinese want back doors in anything that would possibly used domestically? It opens them up to attacks too. While corruption is rampant in China, stupid is not.
Any strange relationships between this company and the military are simply old fashion corruption if you ask me. It makes far more sense.
HA! I just wasted some of your bandwidth with a frivolous sig!
Who's going to cut off trade to the West? China certain ins't going to loose that cash cow and American can't suddenly stand to have no manufacturing plants for their cheap equipment.
Government embargo countries that don't mean anything to them, like cuba. They don't embargo countries which are required for their economy to work.
Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
I was in Ethiopia in mid 2005 to work with Ethiopian Telecommunications Corporation (ETC). Nokia Networks had a room of equipment, HLR, MSC, BSC, SGSN, etc. In the next room over, there was a room of Huawei equipment, and it was all cloned hardware running Nokia Networks software.
I mean.. what did we learn here, really? Nothing. Sounds like FUD from a Cisco employee. Hurray for Slashdot to go mainstream.
If your company spokesman first tells you this:
The shares themselves are known by the Huawei internal term "Virtual Restricted Shares", but according the company spokesman, this is "just a technical name" for otherwise "normal" shares.
Then says this:
Employees allocated shares have to return these when they leave Huawei's employ, according to the spokesman.
Then no those are not shares, everything the spokeman says at this point is likely a lie. Mr. Webb sums it up well:
"Unless and until Huawei becomes a stand-alone widely held listed company with employees free to trade their shares and without a controlling shareholder, these suspicions and allegations will likely continue."
Just wanted to point out they have a joint venture, so that the rumor mill can get more interesting.
Although I understand the desire of the Indians to compete with the Chinese, I am quite puzzled by their strategy. Shouldn't they try to compete by making stuff even cheaper?
Look at the N. Korean "proxy". Can anyone seriously contend that the recent North Korean torpedoing of a South Korean naval vessel did not have Chinese approval, or that they would do it if their Chinese backers did not want it done? Why else are the Chinese resisting acknowledging the evidence? It is clearly a test of the resolve of the US (Obama) in backing, effectively, a long-time ally. If they see Obama follow through on his recent tough talk to stand by South Korea, then all the blustering by the North will fade away. But, if they think he will blink, the never-ended Korean War could get really hot again.
Consider also the testing by the Chinese military in the last year or 2 of a missile designed to travel many 100's of miles close to the ocean's surface - a "carrier killer". Who has carriers worth killing in the Pacific? Us/US. Also, strong indications that some sudden cessation of satellite activity is linked to Chinese testing of satellite killer technology. The "back door" bugging of PC's used by the Dalai Lama's support staff around the world. Stories of US military hardware coming with Chinese counterfeit components. The examples are plentiful and not surprising for anyone familiar with the history of the similar practices developed by the Soviet mentors of the attentive, and equally ruthless, Chinese Communist Party members.
The western democratic based governments, for all their flaws and "oppressiveness", are qualitatively far more preferable to the "Red Chinese" if individual liberty means anything to you - no one said we are perfect, but we can always work to improve "our" governments in ways the Chinese are structurally denied by theirs.
would everyone who owns closed-source tech please bend over.
I interviewed with Huawei in the the last year, and the senior person who interviewed me genuinely did not seem to know who owns Huawei.
I'll never recommend their equipment in any networks I work on. Ever. I'm not an American either.
This is a company that's known to ripped off other network vendors IP blatantly.
It disgusts me the PHBs are so eager to get this gear into networks, because of it's cheapness despite the known history of the organisation.
For any Net Admins/Designers/engineers out there Huawei is your enemy, and slowly out to destroy your job and industry.
I thought everyone knew that Huawei was owned by the PLA or is it just the security industry?
In India (where I come from), large network and infrastructure deals are being lost by nokia, cisco etc to huawei and other chinese low cost products and solutions. So who is behind the ban?. If Chinese companies must be banned for anything, they should be for running sweat shops.
Then why do you put such speculation right up there with the headline?
Me thinks there is much propaganda in the above quote. India sees China as its competitor politically and economically. The Indians will always raise 'concerns', 'doubts' and 'fears' to confuse people... about the devious Chinese (or others they don't agree with). I would much rather pay attention to an EFF report than from a party that has a vested interest in see-ing the other guy fail.
I predict, in 2 years Americans will urinate when someone merely mentions China. And in 5 years, people will talk about good old days when there was USA...